How to Stop Losing Money from Trading?

Stop Losing MoneyToday, I was discussing trading psychology issues commonly faced by traders with some friends and today’s topic became the main theme.

As silly as it sounds, the answer to the question above is so very simple (though contradictory) that many traders may not get it initially. And that is:

“To stop losing money, You need to STOP THINKING about MONEY!”

Nope, this is not a trick question (or answer). In fact, this is a common problem amongst novice and intermediate traders.

The attraction to trading is really on the money and (often) nothing more. That’s not an issue at the beginning because it’s usually Greed or the need for money which lead people into trading. However, this becomes a problem when the novice fails to learn that thinking about money on its own will not help you in your trading career. In fact, it might become a problem.

When an amateur starts to trade, all he does is dream of the financial rewards. Whereas, some intermediate traders will be thinking of how they can recoup their losses from the last trade. When the next trade does not go his way, he then starts doubting his system as well as his own capabilities. That leads to stress and confusion. And the cycle goes one.

Follow the Process and Not the Prize

Visual “…If you focus solely on the number, you’re concentrating on the wrong thing and are likely to become frustrated. What I’m urging you to do is to focus on the actions that you can take immediate, all the while keeping the end result in mind…”

As pointed out by Ari Kiev – taken from his book “Hedge Fund Masters”, thinking about MONEY alone will only cause more problems because traders de-prioritise from the core of being a good trader – the process.

When you only think about the financial returns and nothing else, that process actually messes with your emotions quite easily and that drifts you further away from doing the right thing. The more you think about money, the worse your trading gets, and you’ll start to pay even more focus on money, and the negative belief cycle continues.

Instead, if we focus on the right process, our image will consciously pick images that will enhance our trading process and, in turn, allows us to only take actions that are part of our trading plan (on the assumption that you have a good trading plan).

Again, positive actions leave to positive beliefs, and the positive belief cycle continues.

Feed the Sub-Conscious Mind with the Right Thing

Visual images on our minds are very powerful tools and it has the ability to help us overcome trading psychology issues. It is, however, the same reason why many traders fail to become profitable in the long term. Believe me, you need to start visualising on the right images.

Let me elaborate on how this work.

The human mind has 2 parts:

  • The Conscious mind and,
  • The Sub-Conscious mind.

When we trade the financial market, we are using our conscious mind to perform rational analysis and make entry decisions. However, due to our trading psychology and emotions, our sub-conscious mind sometimes take over to make those irrational trading decisions.

power of mind

What many traders do not realise is that our sub-conscious mind is shaped by our conscious mind. This, in turn, is made up of images that we choose to visualise in our conscious mind.

Hence, the more we consciously think about money, the more we plant that image into our sub-conscious mind. And that continue to fuel our sub-conscious mind to make irrational decisions in our trades because Money is at stake.

Similarly, some frustrated traders (see article) jump from one trading system to another because the only images they hold in their conscious mind are trading systems. They blame that system because their sub-conscious mind only focuses on the System.

Instead of that, we should have images of the process or anything constructive that is not financial related. That will in turn help us to be profitable in the long term.


In short, stop thinking about how much money you can make or lose. Instead, it is important to ask the Right Questions when you’re in the market – focus on the process and the prize will come. You can also start by asking yourself,

How can I be better?” or “How can I make a good trade?”

Both of these are powerful questions to focus on and simple questions like these will make a world of a difference. Please try and let me know how you find it.

Thank you for reading and have a good day!


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